The Hancock-Henderson Quill, Inc.
Ben Rhea gave the top 10 Ag Strategies to attendees at the twenty-first Ag Strategies banquet in Carthage put on by the First State Bank of Western Illinois.
First State annually offers to interested customers, an informative ag meeting and delicious catered meal and door prizes.
Rhea noted that there is a huge difference in income-cost in agriculture from 2000 to today in 2008. Rhea had told farmers at the 2005 Ag Strategies to "stay in tune to state politics." In 2006, he said, "deal with corn price volatility.
In unrolling the top ten strategies for 2008 Rhea suggests to farmers:
10. Read an east coast newspaper
they put a unique twist on what we think about here.
9. Make a record of these numbers....
prices, land, costs, assessments, finance and environment recorded to learn how things change.
8. Build landlord/tenant relationship...
share yield - prices - cost inflation - its key they understand what is really happening here. Not sure 50-50 is the best or not the best - need to look at these - how much things have adapted and changed - don't be caught with one person thinking one thing and the other having different expectation.
7. Invest in firms that profit from you.
Farming can be a huge impact on your community. Maybe you should be buying John Deere stock, Crop Insurance premiums through ownership agency, corn in ethanol plant investing in, selling corn $5 and $12 be aggressive so that is not the last dollar you get off that crop... we thought a lot when corn is $2 and we should still think today about getting further into the retail sector.
6. Update your estate plan.
In 2011 things will change after presidential election.
Rules are different in 09-10-11, pick which year to implement your estate plan.
5. Impact of non-ag economics.
Non-ag - tonight's news probably will be about recession .. DOW dropped 8 percent. It can be critical.
4. DOUBLE DEBT REPAYMENT
What do we do with the extra dollars. Make double payments.... add car payment to boat payment to house payment... double off machinery loan, then to loan #2, 3, & 4. speed up debt repayment.
3. IMPLEMENT FARM BILL CHANGES.
Right now we don't have a farm bill in place... extended 07 bill until March 1st.. Sept. 30 bill expired... The versions proposed appears not to be big huge payments but some worthy to be looked at.
2. STUDY VALUE OF THE DOLLAR
How we are discounted compared to the world market.
Weakening or strengthening of the dollar on the things he just said - ASK.
1. PREPARE FOR THE NEXT OPPORTUNITY.
what might that be... What is their next opportunity for those people buying corn and soybeans... What about those who sold no corn or beans yet waiting to sell at $5...
I really think 2008 is going to be a tremendous year for what is coming next and how things will change. Be ready to take advantage of these opportunities that are coming up yet.
ART TENHOUSE, retired State Representative from Liberty, served 17 yrs. in Ill House of Representatives and was 2nd ranking leader of the House Republicans. He became VP of Gov. Relations of the Ill C.P.A. society and resigned from the position in 2007. etc. fellow farmer....
Tenhouse said Ag Strategies was a great event that a bank would pull this together just for agriculture.
He said it is wonderful to hear about high grain prices. There are years when they don't turn out very well.
"We have no cash, we borrow and mortgage our future," Tenhouse said. He compared it to his time serving on appropriation committee when the government wanted a long-time debt to buy squad cars!
Thirty-four years is a long time to be paying off squad cars! That is the type of things we see, 46 billion dollars in pension debt is just one of the things.
"Rod's numbers only show 6% strongly favorable. He has more relatives than that."
"One thing people don't realize, he has 28 federal criminal investigations against his administration, ...unbelievable!
When I first went to Springfield, the farm lobby was so strong.. Michael Madigan would always say - get out of the way of the farmer, unfornately the last few years the farm groups are being passed aside.
Rod is looking for something to do. He's talking of putting restrictions on carbon emissions that can be made which will limit the trips farmers can make across the field.. If we are restricted, they are going to be very difficult to implement. Chemical lobbiest has mentioned this to me.. but I have not heard anything from the farm groups.
Farmers influence is becoming less and less.... it is very important you get involved.
"Get involved!" he said.